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Rental Property Cash on Cash Return Calculator

Analyze the profitability of your real estate investment by calculating cash flow, cap rate, and cash-on-cash return. Enter your property details below.

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Total Cash Invested (Down + Closing): –
Monthly Mortgage Payment: –
Monthly Cash Flow: –
Annual Cash Flow: –
Cap Rate: –
Cash on Cash Return: –
function calculateRentalROI() { // 1. Get Inputs var price = parseFloat(document.getElementById("propPrice").value); var downPercent = parseFloat(document.getElementById("downPaymentPercent").value); var closingCosts = parseFloat(document.getElementById("closingCosts").value); var interestRate = parseFloat(document.getElementById("interestRate").value); var termYears = parseFloat(document.getElementById("loanTerm").value); var monthlyRent = parseFloat(document.getElementById("monthlyRent").value); var monthlyExpenses = parseFloat(document.getElementById("monthlyExpenses").value); // Validation if (isNaN(price) || isNaN(downPercent) || isNaN(closingCosts) || isNaN(interestRate) || isNaN(termYears) || isNaN(monthlyRent) || isNaN(monthlyExpenses)) { alert("Please enter valid numbers in all fields."); return; } // 2. Calculations // Loan Details var downPaymentAmount = price * (downPercent / 100); var loanAmount = price – downPaymentAmount; var totalCashInvested = downPaymentAmount + closingCosts; // Mortgage Payment (P&I) formula: M = P [ i(1 + i)^n ] / [ (1 + i)^n – 1 ] var monthlyRate = (interestRate / 100) / 12; var numberOfPayments = termYears * 12; var mortgagePayment = 0; if (interestRate > 0) { mortgagePayment = loanAmount * (monthlyRate * Math.pow(1 + monthlyRate, numberOfPayments)) / (Math.pow(1 + monthlyRate, numberOfPayments) – 1); } else { mortgagePayment = loanAmount / numberOfPayments; } // Cash Flow var totalMonthlyCost = mortgagePayment + monthlyExpenses; var monthlyCashFlow = monthlyRent – totalMonthlyCost; var annualCashFlow = monthlyCashFlow * 12; // ROI Metrics var cashOnCashReturn = (annualCashFlow / totalCashInvested) * 100; // Cap Rate = (Net Operating Income / Current Market Value) * 100 // NOI = Annual Income – Annual Expenses (excluding mortgage) var annualNOI = (monthlyRent * 12) – (monthlyExpenses * 12); var capRate = (annualNOI / price) * 100; // 3. Update DOM document.getElementById("resTotalInvested").innerText = "$" + totalCashInvested.toLocaleString("en-US", {minimumFractionDigits: 2, maximumFractionDigits: 2}); document.getElementById("resMortgage").innerText = "$" + mortgagePayment.toLocaleString("en-US", {minimumFractionDigits: 2, maximumFractionDigits: 2}); var cashFlowElem = document.getElementById("resMonthlyCashFlow"); cashFlowElem.innerText = "$" + monthlyCashFlow.toLocaleString("en-US", {minimumFractionDigits: 2, maximumFractionDigits: 2}); if(monthlyCashFlow >= 0) { cashFlowElem.style.color = "#27ae60"; } else { cashFlowElem.style.color = "#c0392b"; } document.getElementById("resAnnualCashFlow").innerText = "$" + annualCashFlow.toLocaleString("en-US", {minimumFractionDigits: 2, maximumFractionDigits: 2}); document.getElementById("resCapRate").innerText = capRate.toFixed(2) + "%"; document.getElementById("resCoC").innerText = cashOnCashReturn.toFixed(2) + "%"; // Show Results document.getElementById("calc-results").style.display = "block"; }

Understanding Cash on Cash Return in Real Estate

For real estate investors, calculating the Cash on Cash Return (CoC) is one of the most critical steps in evaluating a rental property deal. Unlike simple yield calculations, CoC measures the annual return the investor makes on the property in relation to the amount of mortgage paid during the same year.

How the Formula Works

The formula for Cash on Cash return is straightforward but powerful:

Cash on Cash Return = (Annual Pre-Tax Cash Flow / Total Cash Invested) x 100%

  • Annual Pre-Tax Cash Flow: This is your gross rental income minus all operating expenses (taxes, insurance, HOA, maintenance) and debt service (mortgage payments).
  • Total Cash Invested: This includes your down payment, closing costs, and any immediate rehab costs required to get the property rent-ready.

Why Use This Calculator?

Many novice investors focus solely on the Cap Rate. While Cap Rate is useful for comparing the unleveraged potential of properties, it ignores financing. Since most investors use mortgages (leverage), the Cash on Cash Return Calculator provides a more realistic view of your actual return on equity.

Example Scenario

Imagine you purchase a property for $250,000. You put 20% down ($50,000) and pay $5,000 in closing costs. Your total cash invested is $55,000.

If, after paying the mortgage and all expenses, the property generates $300 per month in positive cash flow, your annual cash flow is $3,600.

Result: ($3,600 / $55,000) = 6.54% Cash on Cash Return. This allows you to compare this real estate investment directly against other vehicles like stocks or bonds.

What is a "Good" Return?

While targets vary by market and strategy, many investors look for a Cash on Cash return between 8% and 12%. However in high-appreciation markets, investors might accept a lower CoC (4-6%) in exchange for long-term equity growth.

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